QUESTION 3 25 Choose \"TRUE\" or \"FALSE. as applicable for each of the follow i

Question

QUESTION 3 25 Choose "TRUE" or "FALSE. as applicable for each of the follow items as they pertain to responsibility center reporting. Common fixed costs vary in direct proportion to changes in individual center activity Common fixed costs support only one center of a business Common fixed costs affect the operating income of a A. TRUE B. FALSE center Common fixed costs cannot be eliminated by eliminating an individual center of the business. :Common fixed costs affect the operating income of the business as a whole.

Explanation / Answer

1. .

2. true fixed costs are made always under specific heads for eg building rent

3. false fixed costs always affect the income as a whole rathen affecting the individual unit .

4. true because some expenses are made to be paid throughout the year whether individal is occuring profit or loss

5. true

because fixed costs always relates to the capital as a whole

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